I just finished (yesterday) doing a lot of research on extended warranties, and while it's still fresh in my mind, I'm going to do a brain dump, which will hopefully benefit anyone else on the list considering an extended warranty. (I've gotten a lot of benefit from others' posts, now it's time to give some back)

A lot of people (including Consumer Reports) argue that extended warranties don't make financial sense. The argument is that you're better off investing the money and paying for repairs as they happen. (i.e., self-insuring).

I'm not sure I buy that. I think it depends on several factors, including a) the reliability of the make and model of vehicle you have, b) the reliability of the particular production example of that make and model that you own (in other words, does it tend towards being a lemon?), and c) your own tolerance for taking financial risks.

A word of warning: this field is FULL of shady companies. Warranty Gold, which many people thought highly of, had their service company go belly up. It's registered in the Cayman Islands, and they now have a lot of unhappy policy holders, although they still continue in business with a new service company. Another large firm, whose product was sold by thousands of dealers, also went bankrupt recently.

There are reputable firms out there. GEICO and GE Capital are two. Unfortunately, their products are only sold through dealers when you buy a car (GE) or for new cars less than a year old (GEICO). Check with your insurer, they may have a program that might work for you.

Be aware that a lot of extended warranties are voided if you add any aftermarket stuff to your car, even something as innocuous as changing the exhaust! That's what killed my interest in getting one for my 996, although I continued my research for my wife's car.

In the aftermarket, AAA has a program that looks good, but is expensive. Another one that looks good to me is Warranty Direct, although they have their detractors too. You can turn up a lot of good info about these by going to Google and searching for a company's name in the "Groups" area. (NOT the "Web" area)

Here's a link to an Rennlist-posted MSN story with tips about buying extended warranties: http://tinyurl.com/pp2z

Here's two "sort of" independent sites with info on extended warranties:

http://www.autowarrantyreviews.org

http://www.carbuyingtips.com/warranty.htm

OK, if you read and digest all that stuff, you'll be very knowledgeable about extended warranties. (And probably also very confused, too!)

Whatever you do, best of luck.

=Carlos=